Precision Drilling loses $67M in Q2

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Calgary-based Precision Drilling Corp. on Thursday reported a second-quarter loss of $67 million or 24 cents a share.

That compared with a profit of $57 million or 22 cents per share in the same period in 2009.

Precision Drilling says the outlook for North American oil and gas drillings is slowly starting to brighten. ((CBC))

Much of the red ink came from $52 million in financing charges and from a $26-million foreign exchange loss.

Revenue was up $52 million, to $262 million from $210 million.

Analysts had been expecting Precision to make three cents a share, although the estimates compiled by Thomson Reuters often exclude one-time items and the impact of currency exchange rates.

The company, Canada's largest oil and gas drilling firm, also suggested the outlook for North American drillers is slowly starting to brighten.

"While Precision's activity levels bottomed during the second quarter of 2009," said CEO Kevin Neveu said in a release, "we know it takes several quarters following an activity trough before [the prices paid by oil and gas companies to lease rigs] and margins improve. We believe we are at or near that bottom now."

Precision said more of its rigs are working in oil-related plays than at any time in the past two decades, since oil prices are so much stronger than natural gas prices.

Still, more than half of Precision's active rigs are drilling for natural gas.